Mark Eichorn, Morgan Stanley’s co-head of investment banking, told Bernstein analyst Brad Hintz, that he was somewhat worried boutique investment banks are hurting his bank “from a recruiting perspective” than he is about them stealing deals or clients, according to a note from Hintz Wednesday.

The smaller investment banks “compete for the same talent,” Hintz wrote in his note. Eichorn added that and Morgan Stanley “needs to invest in compensation, since the sacrifices involved in an investment banking career are significant and the way to win new recruits is to provide a medium-term financial payoff.”

Morgan Stanley in recent years has deferred a bigger chunk of their senior employee pay in part to incentivize them to make good long-term decisions and also because of a challenging revenue environment for the firm. Compared with other Wall Street firms, Morgan Stanley has deferred bigger chunks of pay, last year telling its senior employees that it was taking the unusual step of deferring all bonus pay for at least a few months, with some deferrals stretching out several years.

The smaller investment banks often bang the drum about the freedoms their employees have compared to the big boys, and how they don’t need to worry about the same level of pay deferrals.

Overall, Eichorn, a former M&A banker, said he was “optimistic,” about investment banking revenues and Morgan Stanley’s position, according to Hintz’s note.